1. Field of the Invention
This invention relates to a database, method, and system whereby accurate prices paid for products in stores are captured even at a frequent shopper card level and archived for consumer access and market analysis.
2. Discussion of the Background
Consumer purchases these days are becoming increasingly more competitive. To entice consumers to buy a particular product, many retailers and discounters are using a frequent shopper card which, when presented at the time of purchase, substantially reduces the price of the item from that available to members of the public who have no frequent shopper card. These price discounts can vary as merchants use discounts to entice sales in items which will soon expire, be superceded by other items, or in which the distributors or manufacturers have themselves added promotional incentives. While such discount incentives are apparently mutually beneficial to the seller and buyer, knowledge of the actual price paid is critical in determining price margins and the price-acceptance by a customer.
Thus, data reflecting not the inventory list price nor the advertised sales price but rather the actual price paid is needed from across many sources to enable reliable statistical determinations to be valid.
Obtaining this data presents several problems. First, while there are syndicated sources which list prices of individual items, such as for example the manufacturer's suggested retail list price, data indicating the actual price of a product is only readily available at a local level such as the store or retail shop where the item is purchased. Further, consider the problem of relying on inventory price lists. Frequently, prices are negotiated between a seller and a buyer. While this is frequently associated with the purchase of expensive items, such as for example automobiles, price negotiations occur frequently during the purchase of not so expensive items. Price negotiations are also frequently made at a retailer during clearance, inventory reduction, and close out conditions. In these circumstances, the prices are quite elastic, as merchants are driven by other considerations besides prices on the individual items. For example, a merchant needing to clear old inventory to make sales space for new product will reduce prices to clear the old products. Merchants have discretion in setting prices. The economic restraint for the merchant is to pay the distributor or, in some cases, the manufacturer a contracted price. Even with the responsibility to pay the constructed price, it may be advantageous for the merchant to discount below wholesale and loose money on some products, if the discounted price enables the promotion of more profitable goods in the store.
Consider also situations where retailers do on-floor promotions to attract customers into a store. Here, again data showing price acceptance is potentially available, but only through capture of the actual prices paid for the purchased items.
Yet, capturing of data in these situations of extraordinary price elasticity in which marketing data is perhaps the most decisive in determining price acceptance by the customer is not provided for in syndicated sources. Further, the syndicated sources do not capture discounts from frequent shopping card programs.
As a consequence, data bases formed from syndicated price lists reflect average prices which have been set by historical supply and demand factors. Such databases do not necessarily reflect the reality of the sells market today, unless the market is unchanged from when the price lists were created.
Thus, the prices paid for purchased items are nowhere captured in an aggregated, pseudo-real-time database which monitors the price paid and records price history and price paid variations.